ReadWriteStart

JUNE 1, 2020

The primary source of your funds should be your paying customers, i.e., your business should generate enough revenues and profits to fund the growth and expansion. Any custom manufactured IoT device would require software development as well as hardware customization. Both of which are expensive and time-consuming.

Startup 150

Startup Entrepreneur Elevator Pitch Seed Stage 150

Startup Professionals Musings

JANUARY 4, 2020

Angel investors will perk up if you have a prototype or a few real customers, while venture capitalists will likely choose to wait until you have achieved several million in revenue or customer count. If you have a good idea, but haven’t started yet, only friends, family and fools will likely be interested.

Startup 337

Startup Preferred Stock Exit Strategy Equity 337

Steve Blank

APRIL 26, 2022

Some even insisted that all prior preferred stock had to be converted to common stock. Startups that can’t find product/market fit and/or generate sufficient revenue and/or lacked patient capital are scrambling for dollars – and the bottom feeders are happy to help. Why do VCs Do This? ” On one hand they’re right.

Cram Down 404

Cram Down Founder Venture Capital Recapitalization 404

Agile VC

APRIL 17, 2011

How They Make Money: Majority of Kayak’s revenue actually comes from advertising on their site (55%), not lead generation or referral fees to travel suppliers as you might think (more on this below). Financial Snapshot: 2010 Revenue: $170 million. Revenue growth: 51% YoY (2010), 1% YoY (2009), 131% YoY (2008).

Pre-Money Valuation 113

Pre-Money Valuation Liquidation Preference Dividend Common Stock 113

Both Sides of the Table

JULY 29, 2010

People buy companies for 3 primary reasons: 1) they want the management team / talent 2) they want the technology or 3) they want the market traction (revenue, customer base, profits, etc). The downside is that people need to buy their stock. In fact, far better if you haven’t raised venture capital. Do it early.

Venture Capital 282

Venture Capital Term Sheet Valuation Stock Options 282

abovethecrowd.com

FEBRUARY 24, 2015

As a result, a “late-stage” financing is no longer reserved for high-revenue, pre-profitability companies getting ready for an IPO; it is simply any large round of financing done at a high price. You must subtract it from your top-line revenue. You should not pay a net revenue multiple for a gross revenue disclosure.

IPO 40

IPO Liquidation Preference Valuation Technical Review 40

Startup Professionals Musings

AUGUST 1, 2016

Getting investors to trust you with their money is always a challenge, and it’s even more difficult in the early stages, where you don’t have a significant revenue stream, a few customers, or maybe even a product yet. The most investable ventures stem from painful needs by customers who have money to spend.

Due Diligence 120

Due Diligence Intellectual Property Preferred Stock Seed Stage 120

Up and Running

MAY 23, 2016

In fact, SaaS industry revenue is projected to grow from $49 billion in 2015 to $67 billion in 2018, a compound annual growth rate of approximately eight percent. A description of the problem you’re solving for your customers, and your solution to the problem, which is usually your product or service. Solve a problem you can relate to.

Software Review 74

Software Review Software Delaware Forecast 74

Lightspeed Venture Partners

OCTOBER 7, 2012

Week three’s breakdown covered topics like how hard momentum is to turn around, and how participating preferred stock works. They won a design award at a trade show, but have no revenue and no orders. I’ve been writing up reviews of this season’s Shark Tank pitches from a silicon valley VCs perspective.

Technical Review 110

Technical Review Technical Cofounder Valuation Pre-Money Valuation 110

Startup Professionals Musings

MARCH 7, 2015

Angel investors will perk up if you have a prototype or a few real customers, while venture capitalists will likely choose to wait until you have achieved several million in revenue or customer count. If you have a good idea, but haven’t started yet, only friends, family and fools will likely be interested.

Preferred Stock 120

Preferred Stock Exit Strategy Equity Angel Investor 120

Both Sides of the Table

MARCH 21, 2010

As startup entrepreneurs we all want to work with them because having their name as reference clients makes it so much easier for marketing, PR, selling to other customers, fund raising and even recruiting. They negotiate a “master agreement&# to work with your company with some maybe minimum guarantees in terms of revenue.

Warrant 298

Warrant Dilution Startup Stock Options 298

Growthink Blog

MAY 10, 2012

Put everything else on your "wish list" to buy with revenues from sales or additional financing. That is, you'll use the funding to build a product or service and prove that customers want to buy it. The name is derived from the class of preferred stock investors receive in return for their capital.

Equity 88

Equity Mezzanine Later Stage Venture Capital 88

Tim Keane

JANUARY 12, 2010

3]   However, if they are built bottom up, they demonstrate and make explicit a range of business model assumptions the entrepreneur is using to think about his business and its revenue model. Term-sheets for preferred stock offerings are designed to protect the investor in case things don’t go as well as planned.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

www.paulgraham.com

APRIL 28, 2010

There never has to be atime when you have no revenues. By which I meannot that it has to make something physical, but that it has to haveone thing it sells to many people, rather than doing custom workfor individual clients. Custom work doesnt scale. To be a startup, a company hasto be a product business, not a service business.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76